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Diversity, Equity, and Inclusion (DEI): Why Leaders cannot Afford to Ignore it
Across Indian boardrooms, one theme has steadily moved from the sidelines to the strategic center - Diversity, Equity, and Inclusion (DEI). Once viewed as a social ideal, DEI is now a decisive factor in business performance, innovation, and reputation. For today's leaders, particularly in the state of Karnataka, and its dynamic economy, inclusion is not merely ethical - it is essential for competitiveness.
Understanding DEI in Business Terms
At its core, DEI defines how people experience the workplace.
• Diversity is about who is represented-across gender, background, and geography.
• Equity ensures fairness and opportunity without bias.
• Inclusion creates belongingness where every voice is valued.
For CEOs and business owners, DEI is not an HR checklist. It is a leadership mindset shaping how organisations think, decide, and grow. An inclusive culture enables employees to innovate, collaborate, and stay committed, directly impacting productivity and profitability.
In India, where women influence 80% of buying decisions and rural markets account for half of consumption, diverse leadership builds authentic market connection.
Why Leaders Can't Ignore It
Evidence globally shows that diverse organizations consistently outperform their peers. McKinsey's research found that companies with gender-diverse leadership are 25% more likely to exceed average profitability. In India, as the workforce becomes younger and more diverse, inclusivity is directly linked to talent retention and brand strength.
Three shifts make DEI urgent today:
1. Talent expectations - Millennials and Gen Z seek purpose and belonging at work. They choose inclusive employers.
2. Global standards - Investors and regulators now track diversity metrics. SEBI's BRSR mandates disclosures on workforce composition.
3. Innovation - Diverse teams drive creativity, whereas, homogeneous leadership risks groupthink and missed opportunities in a vast, varied market like India.
Ignoring DEI is costly as it leads to higher attrition, reputational risk, and strategic blind spots. Inclusion, conversely, attracts talent, builds loyalty, and strengthens decision-making.
How Leaders Can Drive DEI
The DEI journey begins with leadership intent. Real changes occur when inclusion is embedded into strategy, and merely considered the responsibility of an HR. Leaders can:
• Examine who sits at decision tables and whose voices are unheard.
• Redefine merit to focus on contribution, not visibility.
• Integrate DEI into governance, supplier selection, and board appointments.
• Track progress transparently, just like financial performance.
For MSMEs, even simpler steps make real differences - fair hiring, flexible work practices, and cultural sensitivity.
The Economic Case for Inclusion
DEI is not charity; it is sound economics. Inclusive companies are twice as likely to meet financial goals and six times more innovative. In India, where women influence 80% of buying decisions and rural markets account for half of consumption, diverse leadership builds authentic market connections.
Conclusion
As India stride towards global leadership, DEI must move from policy to practice. The question for every business leader is no longer “Should we invest in DEI?” but “Can we afford not to?”
An inclusive organization is not just Fairer but also Stronger, Smarter, and more Future-Ready.
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Mr. Basappa Manappa
He serves as the Chief Financial Officer of INDIC EMS Electronics Pvt. Ltd., an Indo-Spanish joint venture offering turnkey electronics manufacturing solutions. Mr. Manappa has over 16 years of strategic experience in corporate finance, governance, and business transformation.
Owned by: Institute of Directors, India
Disclaimer: The opinions expressed in the articles/ stories are the personal opinions of the author. IOD/ Editor is not responsible for the accuracy, completeness, suitability, or validity of any information in those articles. The information, facts or opinions expressed in the articles/ speeches do not reflect the views of IOD/ Editor and IOD/ Editor does not assume any responsibility or liability for the same.
